Investment Rating - The report maintains a "Buy" rating for the company with a target price of HKD 9.91, representing a potential upside of 58.9% from the current price of HKD 6.24 [2][7][8]. Core Insights - The company has demonstrated strong early clinical data for its PD-1/VEGF dual antibody (707), showing promising efficacy in treating various cancers, particularly non-small cell lung cancer (NSCLC) and metastatic colorectal cancer (mCRC) [7][8][9]. - The financial outlook is positive, with projected revenue growth of 12% and net profit growth of 13% for FY25, supported by a robust pipeline and favorable market conditions [7][12][15]. - The company is actively pursuing global licensing opportunities for its innovative therapies, indicating potential for international expansion and revenue diversification [7][9][10]. Financial Summary - **Sales Revenue**: Expected to grow from RMB 7,816 million in FY23 to RMB 9,892 million in FY25, reflecting a CAGR of approximately 12.8% [7][12]. - **Net Profit**: Projected to increase from RMB 1,549 million in FY23 to RMB 2,147 million in FY25, with a notable growth rate of 23.2% in FY24 [7][12]. - **Earnings Per Share (EPS)**: Anticipated to rise from RMB 0.64 in FY23 to RMB 0.89 in FY25 [7][12]. - **Valuation Metrics**: The company is trading at a P/E ratio of 6.6 for FY25, indicating attractive valuation compared to industry peers [7][12]. Clinical Development - The company plans to initiate Phase III clinical trials for its 707 therapy targeting NSCLC and CRC in the near future, which could further validate its market potential [7][8][9]. - Multiple early-stage pipelines are entering clinical phases, including promising candidates for pain management and autoimmune diseases, enhancing the company's growth prospects [7][10][12]. Market Position - The company holds a significant market capitalization of HKD 15,080.8 million and has shown resilience in stock performance, with a 52-week price range of HKD 4.94 to HKD 7.82 [2][4]. - The shareholder structure indicates strong institutional support, with TMF (Cayman) Ltd. holding 23.9% and BlackRock, Inc. holding 5.1% [3].

3 Feb 2025 CMB International Global Markets | Equity Research | Company Update EVA Holdings (838 HK) 2H24 preview: both revenue, NP stable HoH Maintain BUY. We project EVA's 2H24E revenue to rise 1% YoY and net profit to increase 2% YoY. We expect auto component revenue to grow faster in FY25E, as new business ramps up. We also expect its office automation (OA) business to remain stable with slight increase in gross margin. We estimate EVA's net profit to rise 18% YoY to HK$289mn in FY25E. We project 2H24E ...

Investment Rating - The report maintains a "BUY" rating for China Life, with a target price of HK$20.00, indicating a potential upside of 38.1% from the current price of HK$14.48 [3][8]. Core Insights - China Life expects a significant increase in net profit for FY24, projecting growth of 122%-144% YoY under IFRS, translating to RMB56.2-66.4 billion, and 100%-120% YoY under ASBE, amounting to RMB51.2-61.4 billion. This is a decrease from the 174% increase observed in the year-to-3Q24 [1][8]. - The potential decline in 4Q net profit is attributed to investment volatilities, despite a strong capital market performance in 3Q24, which boosted total investment income by 152.4% YoY in the first nine months of FY24 [1][8]. - The company is adjusting its strategic asset allocation, increasing exposure to high-dividend yield stocks and balancing equity exposure between FVTPL and FVOCI [1][8]. Financial Performance Summary - For FY24, net profit is expected to range from RMB102.4 billion to RMB112.6 billion, with a projected net profit of RMB110.857 billion for FY24, a significant recovery from RMB47.547 billion in FY23 [2][9]. - EPS is forecasted to be RMB3.85 for FY24, a decrease from the previous estimate of RMB4.45, while FY25 and FY26 EPS are projected at RMB2.68 and RMB2.81 respectively [2][8]. - The company anticipates a 19.2% growth in NBV for FY24 and 9.2% for FY25, supported by a total premium growth of 4.7% YoY to RMB671.7 billion in FY24 [1][8]. Valuation Metrics - The stock is currently trading at 0.24x FY25E P/EV and 0.67x FY25E P/BV, with an expected annualized ROE of 21% in FY24 [1][8]. - The projected dividend yield for FY24 is 8.6%, reflecting an increase in DPS, although it may not match the earnings growth due to the unsustainable nature of net fair value gains [1][8].

Investment Rating - The report maintains a "BUY" rating for Shengyi Tech with a target price adjusted to RMB34.50, reflecting a potential upside of 15.2% from the current price of RMB29.96 [1][3]. Core Insights - Shengyi Tech is expected to see a net profit increase of 46.0-54.6% year-on-year for FY24, with a midpoint estimate of RMB1.75 billion, which is lower than both Bloomberg consensus and the report's previous estimates [1]. - The company is well-positioned to benefit from the growing demand for AI-related products, particularly its ultra-low-loss CCL products, which are anticipated to be utilized in Nvidia's upcoming AI accelerators in 2025 [1][8]. - The report highlights a sector upcycle and the company's leading market position, being the second-largest player in the global CCL market with a 12% market share in 2023 [8]. Financial Summary - Revenue for FY24 is projected at RMB19.84 billion, representing a 19.6% year-on-year growth, with further growth expected in FY25 and FY26 [2][12]. - Net profit for FY24 is estimated at RMB1.81 billion, a significant increase of 55.4% year-on-year, with continued growth forecasted for the following years [2][12]. - The gross margin is expected to improve from 19.2% in FY23 to 22.1% in FY24, indicating better profitability [2][12]. Segment Performance - The preliminary results indicate that the CCL/Pregreg segment's net profit is estimated to be RMB1.42 billion, up 19.5% year-on-year, driven by higher production and sales volume [8]. - The PCB segment is expected to show a turnaround with an estimated net profit of RMB329 million, compared to a net loss of RMB25 million in 2023, driven by increasing demand for multilayer PCBs [8]. Market Position and Growth Potential - Shengyi Tech's products are increasingly adopted in the AI market, particularly its Ultra Low-loss and Extreme Low-loss CCL products [8]. - The company is expected to maintain a net profit growth forecast of 51% year-on-year for 2025, supported by the AI theme and sector upcycle [8].

Investment Rating - Maintain BUY rating for Tuhu Car (9690 HK) with a target price of HK$20 00, representing a 29 9% upside from the current price of HK$15 40 [1][4] Core Views - Tuhu Car's 2H24E adjusted net profit is expected to decline 9% YoY and 32% HoH to RMB243mn due to weaker-than-expected 3Q24 sales and delayed new store openings [1] - FY25E revenue growth is projected to accelerate to 13% YoY, driven by new stores opened in 4Q24 and increased support for existing stores [1] - Gross margin is expected to improve from 25 1% in FY24E to 25 7% in FY25E, supported by lower procurement costs and higher sales of high-margin exclusive and private-label products [10] - Adjusted net profit is forecasted to rise 27% YoY to RMB763mn in FY25E, with a net margin of 4 6% (+0 5ppts YoY) [10] Financial Performance - FY24E revenue is projected at RMB14 764mn (+8 5% YoY), with net profit of RMB445mn (-93 4% YoY) and adjusted net profit of RMB601mn (+25% YoY) [2][10] - FY25E revenue is estimated at RMB16 749mn (+13 4% YoY), with net profit of RMB640mn (+43 9% YoY) and adjusted net profit of RMB763mn (+27% YoY) [2][10] - FY26E revenue is forecasted at RMB18 153mn (+8 4% YoY), with net profit of RMB882mn (+37 9% YoY) and adjusted net profit of RMB994mn (+30 2% YoY) [2][10] Operational Highlights - Total store count is expected to exceed 6 900 by the end of FY24, up from over 900 stores in FY24 [10] - 2H24E gross margin is projected to decline 1 5ppts HoH and 0 7ppts YoY to 24 4% due to price cuts on tire products [10] - Selling expense ratio is estimated to rise 1 1ppts HoH to 13 8% in 2H24E to boost customer traffic [10] Valuation - The target price of HK$20 00 is based on 20x revised adjusted FY25E EPS, reflecting Tuhu Car's resilience compared to peers amid economic uncertainties [10] - Tuhu Car trades at a discount to US peers O'Reilly (ORLY US) and Advance Auto Parts (AAP US), which have valuation multiples of around 30x [10] Share Performance - Tuhu Car's share price has declined 21 1% over the past month, 24 1% over the past three months, and 16 8% over the past six months [6] Shareholding Structure - Tencent Holdings holds a 19 4% stake in Tuhu Car, while Mr Chen Min owns 10 1% [5]

Investment Rating - The report maintains a "BUY" rating for Willsemi, with a target price (TP) of RMB130, indicating a potential upside of 21.9% from the current price of RMB106.65 [1][3]. Core Insights - Willsemi is expected to experience significant revenue growth of 20.9% to 22.8% year-over-year (YoY) for FY24, driven by increased penetration of CIS products in high-end smartphones and autonomous driving technologies [1]. - The net profit for FY24 is projected to be between RMB3.2 billion and RMB3.4 billion, representing a remarkable YoY increase of 468% to 504% [1]. - The company is anticipated to benefit from domestic consumer subsidy plans and the rapid expansion of key markets such as electric vehicles (EVs), edge AI, and robotics [1]. Financial Performance Summary - Revenue is expected to grow from RMB21.021 billion in FY23 to RMB26.295 billion in FY24, reflecting a YoY growth of 25.1% [2]. - The gross margin is projected to improve from 21.8% in FY23 to 29.8% in FY24 [2]. - Net profit is forecasted to increase significantly from RMB556 million in FY23 to RMB3.368 billion in FY24, marking a growth of 506.2% [2]. - Earnings per share (EPS) is expected to rise from RMB0.47 in FY23 to RMB2.83 in FY24, indicating a growth of 502.2% [2]. Market Dynamics - The report highlights that Willsemi's market share in the global CIS market reached 11% in 2023, with expectations for continued expansion [1]. - The company is positioned to benefit from the increasing number of cameras used in vehicles for safety, with projections indicating that vehicles may commonly utilize 10 or more cameras [1]. - The smartphone CIS segment is expected to grow significantly due to China's new consumer subsidy plan, which offers incentives for purchasing smartphones priced below RMB6,000 [1]. Valuation Metrics - The stock is currently trading at an estimated P/E ratio of 38x for FY24 and 26x for FY25, with a forecasted EPS growth exceeding 40% for 2025 [1][7]. - The target price of RMB130 corresponds to a P/E of 31.7x for FY25 [1].

Investment Rating - Maintain BUY rating with a revised target price of US$80 0 (previous US$87 0) [1] Core Views - New Oriental's 2QFY25 net revenue grew 19% YoY to US$1 039mn (+31% YoY excluding East Buy revenue) in line with estimates but non-GAAP net income declined 29% YoY to US$36mn below estimates due to East Buy adjustment and tourism business investments [1] - Management guided 3QFY25E net revenue (excluding East Buy) to grow 18-21% YoY to US$1 01-1 03bn below expectations due to macro uncertainty and intensifying competition [1] - FY25-27E total revenue forecasts trimmed by 2-3% due to softer-than-expected revenue guidance [1] Earnings Summary - FY25E revenue forecast at US$5 081mn with adjusted net profit of US$439 4mn and EPS of US$2 65 [2] - FY27E revenue forecast at US$6 725mn with adjusted net profit of US$829 8mn and EPS of US$5 01 [2] - P/E ratio expected to decline from 25 4x in FY25E to 13 8x in FY27E [2] Business Segments - Overseas test prep and study consulting revenue grew 21% and 31% YoY respectively in 2QFY25 accounting for 24% of total revenue [5] - Domestic test prep revenue grew 35% YoY accounting for 9% of total revenue in 2QFY25 [5] - New educational initiatives revenue grew 43% YoY in 2QFY25 driven by non-academic tutoring (student enrolment +26% YoY) and intelligent learning systems (active paid users +44% YoY) [5] - East Buy revenue declined 9% YoY with a net loss of US$13 5mn in 1HFY25 but would have recorded US$4 6mn net income excluding the impact of Time with Yuhui disposal [5] - Tourism business revenue grew 233% YoY in 2QFY25 [5] Financial Forecasts - FY25E revenue revised down 2 6% to US$5 080 9mn with gross profit revised down 3 8% to US$2 721 0mn [6] - FY25E non-GAAP net income revised down 15 0% to US$439 4mn with EPS revised down 15 0% to US$2 7 [6] - Gross margin expected to be 53 6% in FY25E down 0 7ppt from previous forecast [6] Valuation - Educational and consulting business valued at US$77 1 (96% of total valuation) based on 28x FY25E PE [8] - East Buy valued at US$1 6 (2% of total valuation) based on 8x FY25E PE [8] - Tourism and others business valued at US$1 3 (2% of total valuation) based on 10x FY25E PE [8] - Sum-of-the-parts valuation of US$14 773 7mn with a 10% holdco discount resulting in a total valuation of US$13 296 3mn [9] Peer Comparison - Education sector average PE of 28 4x for FY25E and 16 1x for FY26E [11] - E-commerce sector average PE of 8 0x for FY25E and 7 0x for FY26E [11]

Investment Rating - Maintain BUY rating with a target price of HK$525 0, implying a 34 7% upside from the current price of HK$389 80 [1][3] Core Views - Tencent is expected to deliver solid earnings performance in 4Q24, driven by strong games revenue growth and resilient marketing business [1] - Total revenue is forecasted to grow by 8% YoY to RMB167 6bn, with non-IFRS net income growing by 29% YoY to RMB55 2bn in 4Q24 [1] - Long-term growth initiatives like Weixin e-commerce and AI are viewed positively, with management optimistic about Weixin's role in the e-commerce ecosystem and AI as a key growth driver for the marketing business [1][8] Earnings Summary - Revenue is expected to grow from RMB554 6bn in FY22 to RMB755 8bn in FY26, with adjusted net profit increasing from RMB115 6bn in FY22 to RMB257 6bn in FY26 [2] - Adjusted EPS is projected to rise from RMB12 13 in FY22 to RMB26 60 in FY26 [2] - P/E ratio is expected to decline from 55 2x in FY22 to 17 4x in FY26, reflecting improved earnings growth [2] Business Forecasts and Valuation - Revenue forecasts for FY24-26E are largely unchanged, with slight downward revisions of -0 1% to -0 3% [9] - Gross margin is expected to improve from 53 1% in FY24E to 54 4% in FY26E, driven by higher-margin games and marketing businesses [9] - Operating margin is projected to increase from 31 9% in FY24E to 33 7% in FY26E [9] - The SOTP-derived target price of HK$525 0 includes valuations for games (HK$199 9), SNS (HK$29 4), marketing (HK$110 3), fintech (HK$82 5), cloud (HK$22 0), strategic investments (HK$68 4), and net cash (HK$12 7) [10][11][12][13][14] Key Takeaways from NDR - Weixin e-commerce is positioned as a connector in the ecosystem, leveraging third-party services and technology to reduce transaction frictions [8] - AI remains a key growth driver for the marketing business, with Tencent maintaining leadership due to its large user base and use cases [8] - Tencent's inclusion in the US CMC list and removal from the USTR "Notorious Markets List" are seen as positive developments [8] Peer Comparison - Tencent's gaming business is valued at an 18x 2025E PE, in line with global peers like NetEase and Electronic Arts [16] - The marketing business is valued at a 20x 2025E PE, reflecting its resilient ad revenue growth supported by Weixin Video Account and Mini Program [16] - Fintech and cloud businesses are valued at premiums to peers, reflecting Tencent's strong market position and growth potential [16][17] Strategic Investments - Tencent's strategic investments are valued at HK$68 4 per share, with significant stakes in companies like PDD Holdings (14 1%), Sea Ltd (18 2%), and Spotify (8 4%) [19] - A 30% holding company discount is applied to the fair value of equity investments [19]

Investment Rating - Maintain BUY rating with a target price of RMB52, implying a 56.6% upside from the current price of RMB33.20 [1][3] Core View - Wingtech is transitioning to a semiconductor-focused company, positioning itself for long-term value creation despite short-term financial setbacks [1] - The company expects a net loss of RMB3.5-4.55bn in FY24, primarily due to one-off impairments related to the sale of its ODM business, write-down on deferred tax assets, and goodwill impairments [1] - The semiconductor business showed resilience in FY24, with sequential revenue growth in 2Q and 3Q, and single-digit YoY growth in 4Q despite seasonal softness [7] - Wingtech's ODM business improved in 4Q, turning profitable excluding impairments, but remains a low-margin segment [7] Financial Performance - Revenue is expected to grow 18.1% YoY in FY24 to RMB72.3bn, with further growth of 10.9% and 5.8% projected for FY25 and FY26, respectively [2] - Gross margin declined to 10.4% in FY24E from 16.1% in FY23A, but is expected to recover to 13.2% and 14.8% in FY25E and FY26E [2] - Net profit is forecasted to rebound strongly in FY25E, growing 186.4% YoY to RMB2.61bn, followed by 45.0% growth in FY26E to RMB3.78bn [2] - Operating profit is expected to increase 155.6% YoY in FY25E to RMB4.18bn, driven by the company's transformation and semiconductor focus [2] Business Segments - The ODM business accounted for 17% market share in 1H24, ranking third among top players in China, down 3ppts YoY [7] - Semiconductor revenue grew sequentially in FY24, with 2Q and 3Q showing 10% and 15% QoQ growth, respectively [7] - China contributed ~40% of total semiconductor revenue in FY24, offsetting overseas weakness due to inventory correction [7] - Auto revenue currently accounts for 60% of total semiconductor revenue, with overseas OEMs expected to resume restocking in 2025 [7] Valuation and Outlook - Wingtech's valuation is expected to benefit from increasing semiconductor revenue share, robust domestic auto demand, and a re-rating opportunity as it transforms into a semi-centric company [7] - The target price of RMB52 corresponds to 24.8x FY25E P/E, based on unchanged financial forecasts [7] - The company's market cap stands at RMB41.26bn, with an average 3-month turnover of RMB1.68bn [3]

Investment Rating - The report maintains a "BUY" rating for JD.com, with a target price of US$53.20, indicating a potential upside of 36.4% from the current price of US$39.00 [3][11]. Core Insights - JD.com is expected to report solid results for 4Q24, with total revenue projected at RMB334.6 billion, reflecting a 9.3% year-over-year growth, which is 3% above Bloomberg consensus. This growth is attributed to the nationwide home appliance trade-in program, JD's strong GMV exposure in the home appliance category, and robust supply chain capabilities [1][8]. - Non-GAAP net profit is anticipated to grow by 13.2% year-over-year, exceeding consensus estimates by 16%, driven by gross margin expansion and optimized sales and marketing costs [1][8]. - The report emphasizes that JD.com is well-positioned to benefit from the trade-in program in the short term, while long-term growth will depend on sustainable earnings and enhanced shareholder returns [1][8]. Financial Performance Summary - For FY24E, JD.com is projected to achieve revenue of RMB1,146.4 billion, a 5.7% increase from FY23A, with non-GAAP net profit expected to reach RMB46.1 billion [2][9]. - The adjusted net profit for FY24E is forecasted at RMB46.1 billion, with an adjusted EPS of RMB29.05 [2][9]. - Revenue growth is expected to continue into FY25E at RMB1,218.0 billion, representing a 6.2% increase, and further to RMB1,278.0 billion in FY26E, with a growth rate of 4.9% [2][9]. Segment Performance - The Electronics and Home Appliance (E&HA) segment is projected to see a 10% year-over-year revenue growth in 4Q24, supported by the trade-in program [7][8]. - JD Retail (JDR) is expected to report segment revenue of RMB294.0 billion in 4Q24, up 9.8% year-over-year, with operating profit anticipated to increase by 28% year-over-year [7][8]. Forecast Revisions - The revenue forecast for 2024-2026 has been revised upward by 1-2%, and non-GAAP net profit forecasts have been increased by 2-8%, primarily due to improved expectations for the E&HA segment and better gross margin forecasts [8][9]. - The gross margin for FY24E is projected at 15.9%, with non-GAAP net margin expected to be 4.0% [9][10]. Valuation Metrics - The report indicates a P/E ratio of 11.1x for FY24E, decreasing to 9.1x by FY26E, reflecting a favorable valuation compared to historical levels [2][9]. - The DCF-based target price of US$53.20 is based on a WACC of 11.8% and a terminal growth rate of 1.5% [11][12].